Pros and Cons of the Healthcare Reform Bill

(Updated) Pros and Cons of the Healthcare Reform Bill My previous list of pros and cons of healthcare reform has gotten a bit dated. I’ve updated it. Once again, I’ve attempted to keep it as simple and non-partisan as I can manage. Let me know if you think I have misrepresented anything or left out anything crucial. Pros: * A lot of people who don’t have health insurance will now have health insurance. o 95% coverage of legal U.S. residents under 65 will be covered. Compare this with 83% and dropping now. This is an increase of 32,000,000 people. (Those over 65 are already covered by Medicare either way.) o Insurers will not be able to stop paying for people who are sick, even if they lose their jobs. o People who cannot afford health insurance won’t have to pay as much money for it. If you are particularly poor, insurance will be very cheap or even free. o People who are already sick will be eligible for healthcare. o Medicaid availability will expand significantly o Children will be able to stay on their parents’ insurance plan until they are 26. * Insurers must spend at least 80% of premiums on actual medical care. * There will be a federally regulated insurance marketplace that should make health insurance more portable. * The bill will reduce the deficit. * Medicare fraud will be cracked down on. * The prescription drug “donut hole” will be closed. (If you don’t know what that is, you will now never have to worry about it.) Cons: * Most of the bill won’t go into effect until 2014 * For the first ten years, it will cost $94 billion a year on average. This is a bit less than the yearly cost of the Iraq War. Unlike the Iraq War, there are cost savings and tax increases to more than cover all of this expense. * The bill might increase the cost of health insurance in some states. This depends on whether the gains from increased efficiencies and increased competition are outweighed by the cost of providing additional benefits. * The Individual Mandate. You will have to either buy health insurance if you don’t have it or have a 2.5% tax increase. This insurance will be subsidized for most people—but there is no guarantee that the subsidy will suffice for your specific situation. * There will be a tax on very expensive health insurance plans. * There will be a tax increase on very high income people. If you are making more than $200,000 (or $250,00 for a family) your Medicare Payroll tax will increase and you will need to pay Medicare taxes on investment income. Other stuff that might be good or bad, depending how you feel about things: * Increased government involvement in healthcare. Government already pays for huge amounts of healthcare—so this won’t be anything new. * The bill is abortion-neutral. There will be no federal money for abortion. It will also not have additional restrictions on it. Neither side gets everything it wants on this one. * Additional regulation on insurance companies. This might increase costs. It will increase quality. * Doctors will have increased access to information about what treatments are most effective for their cost. If two treatments work equally well and one is cheaper, doctors can recommend that one. This was almost universally considered a good thing until a few years ago, but some people have started criticizing it lately. * Large employers will have to offer health insurance all of their employees or pay a fee. * Medicare Advantage plans will get less federal money. They will still get the money normal medicare patients get. So the Federal government will still be giving extra money to private insurance companies—but it won’t be giving them as much extra money. * In the long run it will (hopefully) reduce medical costs. Rising medical costs are the main reason the long-term budget projections are so alarming. Something has to be done. Unfortunately, this bill might not do enough. While there will definitely be some savings, it’s not clear that they will be as transformative as hoped. * There will not be a public option for people who want it.